Direct credit to productive sectors of the economy with intelligent oversight

According to the Central Bank, Ali Salehabadi, Governor of the Central Bank, said on Radio Eghtesad’s Shokooh Iran program, referring to the Supreme Leader’s menus on credit management policy: “The Supreme Leader said that the growth of liquidity and inflation in the last decade There has been a significant increase, while the real sector of production and GDP growth and the formation of fixed domestic capital have not grown proportionately, which has caused inflation in the economy. On this basis, they asked the Central Bank and said that credit should be directed towards production and productive economic activities.

Explaining how this is achieved, Salehabadi said: “Part of this is related to the Central Bank, which is achieved by intelligent monitoring of the correct use of facilities;” That is, through the systems we have, as well as monitoring the flow of funds, we will act in such a way that credit is directed to the real sector of production and capital is not diverted to unproductive activities.

The Governor of the Central Bank added: “The other part is related to the Tax Affairs Organization, in which the banking system should be connected to the tax system, that is, if a person takes credit and capital to unproductive activities, he should be subject to his own tax.” It is also in accordance with the law, and accordingly, the issue of capital gains tax is currently being discussed in the Economic Commission of the parliament, which will be very effective if approved.

He continued: “In next year’s budget bill, the production tax will be reduced from 25 percent to 20 percent, and if the capital gains tax bill is approved, the tax on speculative activities will increase.”

Declining trend in inflation and stability in the foreign exchange market

Salehabadi stated that the monthly inflation was 1.8 percent in December, 2.4 percent in November, 3.1 percent in October and 3.3 percent in September, and announced the decreasing trend of the inflation rate and said: Fortunately, liquidity growth and inflation have been controlled and reduced in recent months, with the monthly inflation rate rising from 3.3 percent in previous months to 1.3 percent in January.

The Governor of the Central Bank added: “The balance of the foreign exchange market and the stable trend of the Nima system and the downward trend of prices in the organized foreign exchange market have helped to reduce and control the inflation rate.” The trends that are taking place are promising and we hope that this positive trend in our economy will continue.

Salehabadi further stated about maintaining the value of the national currency and strengthening it: a part of controlling the value of the national currency is related to the foreign exchange market and balance in this market and that the exchange rate fluctuates in a certain range; Therefore, the balance in this market can greatly help maintain the value of the national currency. The second part is related to inflation, which, as mentioned, has been controlled by inflation growth in recent months.

Banking reform is being seriously pursued

The Governor of the Central Bank pointed out that in order to preserve the value of the national currency, we must plan to reform the banking system: “We are following this issue seriously.”

He added: “Reform in the banking system means that banks should have more discipline. In fact, the central bank’s supervision over smart and systematic banks and the banks’ overdrafts from the central bank will be controlled;” Therefore, we are seriously pursuing the Central Bank law that is currently in the parliament to be approved.

Salehabadi pointed out: reforming the banking system will be one of the axes to reduce inflation to control the banks’ overdrafts from the central bank and finally to curb one of the roots of the monetary base. The issue of reforming the financial relationship between the government and the central bank is also very important, meaning that the government’s overdraft from the central bank is one of the other roots of inflation that we are seeking to reform.

The Central Bank expects the parliament to approve the 1401 budget bill

In the end, the governor of the bank added: “Considering that we in the government reviewed and summarized the 1401 budget bill so that it can be adjusted so that it does not have a deficit, so these days we expect the parliament to approve the budget bill in a way that Close the deficit.

He stressed: “It is important that imaginary sources are not seen in the budget law; Because expenses usually happen, but sometimes revenues do not happen and this causes a budget deficit; Therefore, my request to the parliament is to close budgets without deficits in order to control another root of inflation, which is the overdraft or borrowing of governments from the central bank.